investments

Worrying stuff for local government workers in Derbyshire and West Yorkshire. Interestingly this article makes me ponder if we can afford to let someone like this take risks with our money why can’t we do more to invest it instead in local economic development. The impact could be particularly strong in rural areas affected by market failure.

Council workers have been left exposed to the underperformance of Neil Woodford’s stock market-listed fund, with a £10m investment by council pension schemes at risk from the fund’s declining share price.

Shares in the Woodford Patient Capital Trust Fund have tumbled 25% to 58p since 3 June, when Woodford made the shock decision to suspend his flagship Equity Income Fund, following a surge in redemptions sparked by bad market bets.

While the FTSE 250-listed fund is not directly affected by the suspension, the move at its sister fund caused a sell off in shares and the value of shareholder investments to decline.

At least three local authority pension funds, including Derbyshire, West Yorkshire and Dyfed in Wales, have investments tied up in Woodford’s patient capital fund and risk seeing their investments fall further as the stock price continues to slide. Those pensions investments help fund retirement benefits for members including local government employees, councillors, school teachers, charities and housing association staff.